Ent_5 - MNG00314 Entrepreneurship Top 5: Business Planning...

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MNG00314 Entrepreneurship Top 5: Business Planning Process
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Learning Objectives On completion of this topic, you should be able to: prepare a business plan Benefits for the Entrepreneur from a Business Plan Pitfalls to Avoid in Planning Guidelines of a Business Plan
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Business Plan A business plan is the written document that details the proposed venture It must describe current status, expected needs and projected results of the new business It can be the entrepreneur’s roadmap for a successful enterprise A business plan can be referred to as a venture plan, a loan proposal or an investment prospectus It’s not just the writing of an effective plan that is important but also the translation of that plan into a successful enterprise
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Benefits for the Entrepreneur from a Business Plan The time, effort, research and discipline needed to put together a formal business plan force the entrepreneur to view the venture critically and objectively The competitive, economic and financial analyses included in the business plan subject the entrepreneur to close scrutiny of his or her assumptions about the venture’s success Since all aspects of the business venture must be addressed in the plan, the entrepreneur develops and examines operating strategies and expected results for outside evaluators The business plan quantifies objectives, providing measurable benchmarks for comparing forecasts with actual results The completed business plan provides the entrepreneur with a communication tool for outside financial sources as well as an operational tool for guiding the venture toward success
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Benefits for Financial Sources from a Business Plan The business plan provides for financial sources the details of the market potential and plans for securing a share of that market Through prospective financial statements, the business plan illustrates the venture’s ability to service debt or provide an adequate return on equity The plan identifies critical risks and crucial events with a discussion of contingency plans that provide opportunity for the venture’s success It gives financial sources a clear, concise document that contains the necessary information for a thorough business and financial evaluation It provides a useful guide for assessing the individual entrepreneur’s planning and managerial ability
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The Importance of Planning Planning is essential to the success of any undertaking. Critical factors that must be addressed when planning are: Realistic goals . These must be specific, measurable, and set within time parameters. Commitment
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Ent_5 - MNG00314 Entrepreneurship Top 5: Business Planning...

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